The Cat & Mouse Game of Mediclaim Policy
A majority of the workforce in India has been getting enrolled in Corporate Mediclaim Policy from the day they join the office. An enrollment in Corporate Mediclaim Policy is usually done by the HR & Admin Department, subject to the concerned employee not falling under Employees State Insurance Corporation (ESIC). ESIC is a body formed by the Government, who undertake “insurance work” (similar to the private insurance companies) for all the workforce whose gross salary is less than INR 21,000/- per month. The benefits are tremendous. For others, whose salary is more than INR 21,000/- per month, Mediclaim is normally attained to, although there is no rule that defines so. It is done by Corporates as a social security measure.
Apart from the various difficulties and terms & conditions for cashless treatment and reimbursements, a lot happens behind the doors, that the employee doesn’t get to know.
Interesting Unknowns of Mediclaim Policy
Typically, you shall get an email from the HR Department informing you about the Mediclaim & Group Accident Policy that is getting operational for a period of one year from say 1st May 2014 to 30th April 2015. You shall first have to pay attention to the number of dependents to be enrolled, Sum Assured and Illness or Diseases Covered. Typically, 1+3 is the rule followed, meaning yourself & 3 dependents for a Sum Assured of say Rs. 3 Lacs. Premium is paid by the Company, which may or may not be added in your Annual CTC.
Know Your TPA
TPA stands for Third Party Administrator. TPA is nothing but a middle man or a Consultant of sorts, who helps the Company & it’s employees to process the claims.
Basic Guidelines To Follow
Different Insurance Companies may have different guidelines but generally they would want the Claim Intimation to be given within 24 hours of hospitalization and all hospital bills / docs to be submitted for reimbursements within 30 days from the date of discharge of the patient. If you can follow these 2 rules, 50% of your worry is over (of course, the illness needs to be covered in the Policy). Ensure all docs are submitted in original, along with hospital’s attestation.
Insurance Company Also Has a Profit & Loss Statement !
Most often I have observed that in the initial phases of the Mediclaim Policy taken up by organizations, the claims are cleared pretty fast. As the period of insurance policy is about to come to an end, the processing of bills take longer. Sometimes, they are outright rejected or a lot of times, delayed. I agree it could be pertaining to illness that is not covered, or the representatives of these insurance companies, who reject certain bills are also qualified & respected doctors & they know the current market charges. But this experience of mine is based on 8 years. Why the same trend across 8 years ? It is then that I started to think from the Insurance Company’s point of view and felt that they also have to prepare a P&L Statement.
The premium that your Company pays to them is their revenue. Your hospitalization bills that they clear is their expense. If the amount of bills cleared exceeds the premium paid by the Company, it is a straight loss for them. So I don’t know.. if there is any way for them to keep a tab on the bills cleared v/s the premium paid. Could be. Besides, at the time of policy expiry, Corporates may choose a different Insurance Company who offers them lowest quotation of premium and they may not necessarily get contract for the next year. Hence, the cautious approach I feel towards the end of policy period.
HR Manager’s Worry
An HR Manager, especially in manufacturing segment, has one big worry here. More often, the manufacturing unit has a Union, and all workers are a part of this union. Hospitalization of anybody’s family member or relative is not a positive sign, unless it’s a pregnancy. Empathy is utmost required during such situations. None-the-less, because Company has opted for a mediclaim policy for it’s workmen (as per their agreement with eachother), I have felt workmen taking that as a matter of right. So, they present the mediclaim card to the hospital. The hospital, on knowing about the policy, mostly tries to inflate the costs. If the insurance company clears the inflated bills (which is not likely), the hospital earns handsome profit. If the inflated bills get rejected and claim is passed of a smaller amount, hospital demands the balance from the employee and thus earns their share of profit. Now, the employee (especially a worker) is helpless and turns for help to his Company. That’s fine & acceptable. Where will he go afterall ? But, the ball is now in Company’s court to offer advance or loan, rejection at this point may trigger adverse outcome and a negative reaction / precedent from overall workforce. If the said employee requesting for loan, has existing loan already, that too of a big amount, that’s another worry.
I have also seen, if the HR Manager politely & transparently explains to his workmen on this inflated bills’ scheme by the hospitals and requests them to be a little more cautious, people tend to take it very personally and immediately feel as if he is against them and is only thinking from Company’s point of view. Let me assure you on behalf of all HR Managers – this may not be necessarily true. Could be that he is trying to help you by giving a picture of how wrong practices are being done. May be the timing of that discussion is wrong. One solution to avoid this feeling is to discuss these points when there is no emergency at any employee’s home, when everything is normal, everything going okay. During hospitalization, this will just not get registered in anybody’s minds.
One Question From Me to Hospitals
I understand there shall be some expenses which are not passed by default under a mediclaim policy, say bandage in case of a fracture. Fine ! But if a hospital hands over a bill of say INR 75,000 to a Company Employee and his insurance company passes bills worth say INR 55,000 only, can we conclude that the balance INR 20,000 (which has not been passed by the insurance company), is actually the unrealistic, unnecessary money that had been charged to the employee by you ? Can I assume that this INR 20,000 is greed ? Even if we assume 10% of the bill (i.e. INR 7,000-8,000) for miscellaneous expenses that it is generally not passed, even then the balance INR 12,000-13,000 is still unaccountable. Pl enlighten me too !
This is a personal view on the Mediclaim Policy matter, from an HR Manager’s standpoint, the conflicts faced by me in my day-to-day work-life and is being presented to help people appreciate “the other side” (Management’s or HR’s dilemma) in sorting this issue. Your suggestions and comments are welcome. Picture Source is “The Hindu Business Line” Issue.